Do you want to increase sales without lowering price or discounting?
I bet you want to. And, who doesn’t?
Everybody in the business world wants more sales. With more sales comes more money that helps in growth of an organization.
But, what’s the big fuss about lowering price for increasing sales?. Why is that not desirable?. Because it affects the profit margin of a business.
Lowering price may help you to gain sales in short-term but in long run, it will hurt the bottom line. Take Amazon, the e-commerce giant, as an example. They regularly cut prices aggressively to attract & retain customers.
While cutting prices may be a fair strategy for someone like Amazon but for a small business, it can have a disastrous impact on sustainability.
Therefore, for small businesses, retailers, startups & home-based entrepreneurs, lowering price for increasing sales is not a feasible option.
But one thing is for sure. Lowering price is the fastest way to increase sales hands down. If you have secured funding then do consider lowering price to acquire initial customers quickly. This is what most funded software startups do to gain traction initially.
In this post, we are going to talk about 10 unique strategies to increase sales without lowering price.
No, to increase sales, you need not do the obvious stuff (these are what most marketing gurus will suggest you do):
- Geographical expansion
- Investment in people
All the aforesaid ways are going to cost you money, time & lot of effort.
So, instead follow these simple tweaks that can help you increase your revenue quickly:
HOW TO INCREASE SALES WITHOUT LOWERING PRICE OR DISCOUNTING
1. Reach Out To Existing Customers
Did you know that your existing customers are your biggest source of future sales?. Yes, they are.
They are the people who can make or break your business. And, more importantly, they know you & your business. So, why not reach out to them for more sales?
Most businesses make this mistake of focusing too much on prospective customers instead of existing customers. So, please don’t make this blunder.
Reach out to your existing customers with your new product or offering. Communicate & listen to them. Sure, there are high chances that they will re-order stuff.
This strategy is best suited for service businesses.
Take an example: Imagine, you are into a corporate catering business & have launched a new banquet service. To get a jump start in the new vertical, go & pitch your new service to your existing catering customers. This way you have chances of conversion (for your new service vertical).
2. Start A Referral Program
What if each of your incoming & present customers starts referring a new customer?. Well, that way your number of customers would double! And, probably your sales too.
So, start a referral program now.
You may configure the referral program manually or find a reliable referral management software.
Offer the referring customers a year-end incentive, gift or prize.
The referral program strategy seems to work best for online businesses, e-commerce & SaaS companies.
3. Cross-Sell Supplementary Products or Services
What if you offer supplementary products or services to your clients, users & customers?
Chances are high that they are going to buy it because the supplementary product or services would be related to the original product.
Amazon nails this strategy like a king. Look at the following screenshot where a Guitar is an original product & a Guitar tripod is a related product.
This strategy works equally well for all kind of businesses & services.
Take an example: Imagine you are a financial consultant offering tax service to a particular client. How do you increase sales?. Simply reach out to that client & offer your other supplementary services like bookkeeping, internal audit, wealth management etc.
4. Place Your Product Strategically
This strategy works best for retail or physical stores.
What happens when you place your target product right next to a similar high priced product?. Yes, you are right. It becomes easier to sell the target product.
Take an example: If a $200 guitar is placed next to a $2000 guitar then the $200 guitar has a high chance of being sold.
This pricing strategy is also known as Price Anchoring & is used commonly by marketers around the world.
Now, you must be wondering as to why this works. It’s all about psychology. The human mind is wired to compare numbers & take decisions (especially when it comes to shopping or buying stuff).
5. Don’t Charge Shipping Fee Separately
What if you include the shipping fee right into your product price & display your shipping fee as “FREE”?. Well, the sales most likely would jump.
Take an example: If you are selling a wristwatch at $100 & charging $20 as shipping fee then try including the shipping fee into product price to make $120. Display the shipping fee as “FREE”.
This strategy works because buyers generally don’t mind paying for the product but hate anything over & above that.
Don’t believe me? Then, look at the following survey published by Statista.
As can be seen, “unexpected shipping cost” is the topmost reason why digital buyers abandon their carts in the US.
Needless to say, this pricing strategy works best for e-commerce companies.
6. Offer Subscription
Instead of an outright sale, what if you offer your product or service for a periodic subscription fee?. Yes, because of affordability, more customers would buy your products or services.
From a customer point of view, the following are the advantages of choosing subscription over out-right purchase:
- Less risk
From a seller point of view, subscription revenue model has the following advantages:
- Increased sales
- Recurring cash flow
This strategy is commonly followed by SaaS companies. Look at the following example from Slack:
It’s not that this pricing model will work only in case of a SaaS company. Case in point: Cort, an online furniture retailer offers furniture on rent.
7. Re-Jig The Price Display
As a customer which one of the following prices appeals you the most:
- $199 (Earlier $499)
Of course, the third one is the most appealing. Why?. Because it gives a feeling that you are getting a great deal & its simple as well (without decimals like in the first one).
This is perhaps the simplest strategy to increase sales without lowering price instantly. Moreover, it is also very effective.
Unlike other strategies, this can fit into any kind of business or revenue model.
8. Deliver A Top-Notch Customer Service
Jack Ma, the famous founder of Alibaba group, once had said:
Never ever compete on prices, instead compete on services and innovation.
Great customer experience can not only help your business get more sales but also charge a premium price. And, this strategy is what has been pioneered by the technology giant Apple Inc.
‘Word of mouth’ still is one of the most effective marketing channels & a top-level customer care helps you with just that.
When your existing customers get good customer experience then they do the following:
- Spread the word about how awesome your service is
- Refer their friends & colleagues
- Talk about your business on social media
All the aforesaid are going to help you get more customers free of cost. And, more customers mean more sales.
But why does this happen?. Why do customers crave for good customer service? It’s because that makes them feel important. Everybody wants attention & with a good customer service, you get one.
Apart from increased sales, a good customer experience helps build an army of loyal fans & brand building.
Still, have doubts about the massive impact of service on sales? Then, check out this survey by ConverSocial:
Of course, this strategy can be applied to all types of businesses & organizations.
9. Partner With A Business
A business partnership is a proven way to get qualified customers fast.
Take an example: If you are into travel business then why not tie up with a wedding planner?. This arrangement will ensure that the wedding planner provides you with highly-qualified leads (newly married couples) to boost your sales.
This strategy is time & again used by top brands. Take a case in point of the business partnership between Apple & Nike since the early 2000s.
Of course, this strategy involves an affiliate payment to the referrer business. And, such affiliate payment can either be in the form of money or some other form like a reverse referral.
Apart from increased sales, business partnerships also help in:
- Improving industry network
- Build brand
- Learn best practices from the referrer business
The good thing about this strategy is that it works well in all kind of business or service sectors.
10. Collect Outstanding Dues Faster
This is perhaps the most underestimated strategy among all.
Did you know that simple follow up can help you recover dues faster from your business debtors?. Yes, it can.
But, what is the advantage of recovering faster in terms of sales?. Simple. Faster collection of dues implies faster re-ordering from customers (debtors). And, the faster re-order results in a faster sale.
So, the frequency of sales increases if you follow up with the business debtors in a timely manner. Needless to say, increased frequency means increased sales.
Take an example: Imagine. one of your business debtors takes 30 days to clear an invoice. What if you follow up frequently & finally bring down the credit period from 30 days to 20 days? That may perhaps result in a re-order 10 days faster or earlier!
This strategy works best in B2B service & wholesale distribution businesses.
We have our 10 strategies to increase sales without lowering price covered.
Each of the ideas discussed is easy & quick to implement. Further, none of the ideas is costly to execute.
What do you think of the aforesaid ideas to increase sales without lowering price? Please comment below.